Chris Knight reports on the prospects for President Obama's offer of free community college courses.

By guest blogger Chris Knight

Fixing education requires more than just broader access, according to a gathering of top academics, industry experts and student entrepreneurs in San Francisco earlier this week.

Thursday night on his way from Detroit, MI to Knoxville, TN for the last leg of his 3-city tour to preview his State of the Union address on January 20, President Obama announced on Air Force One that he plans to make community college accessible for everyone who's willing to work for it.

He's asking to pass new legislation for two years of community college for all.

Victoria Espinel, the recently appointed head of BSA | The Software Alliance (formerly Business Software Alliance) visited San Francisco recently to gauge the mood of Silicon Valley towards software patents and intellectual property laws in the US and around the world.

Based in Washington, D.C, Espinel served in the Obama administration as the first US Intellectual Property Enforcement Coordinator, and worked in the Bush administration in senior positions in the Office of the US Trade Representative.

But you'll have to go elsewhere to hear about its support for Senator James Inhofe, described by a San Francisco Chronicle columnist as "the delusional or dishonest Oklahoma Republican" who has called global warming the "greatest hoax."

Foremski's Take: The problem with the Internet is that the same methods that a company such as Google uses to monitor its users for clues about what they might purchase next, so it can show relevant ads, can just as easily be used by governments to monitor its citizens for political and oppressive purposes.

This question arose from her recent attendance at the White House Hispanic Community Action Summit in San Jose, CA where plans were discussed on how to use social media and online marketing to target the Hispanic population. The goal is to offer programs that will raise the number of Hispanic students in colleges by 4.5 million over the next ten years.

ICANN, the California non-profit organization responsible for setting the name of all domains, will soon allow a vast array of new names to be created. Beginning next year, for the right amount of money ($185,000) you'll be able to create the right to use almost any word as a top level domain name (TLD) instead of generic TLDs .com, org, etc.

Cisco Systems is helping the Chinese government build a massive surveillance system that will include more than 500,000 cameras. The Wall Street Journal reported that the "Peaceful Chongqing" project gets around US restrictions on US companies helping repressive foreign governments because it is billed as an "anti-crime" network.

TechEye reported that several other companies had bid for the project including Hewlett-Packard. But that the deal deserves scrutiny:

Free Press, the non-partisan lobbying organization, reports that US companies are involved in providing technology that helps the Egyptian government monitor protestors on the Internet and mobile phones.

Free Press issued a statement that claims:

Boeing-owned, California-based company Narus sold Telecom Egypt, the state-run Internet service provider, "real-time traffic intelligence" equipment, more commonly known as Deep Packet Inspection (DPI) technology. DPI is content-filtering technology that allows network managers to inspect, track and target content from Internet users and mobile phones as it passes through routers on the Web.

...

Narus Vice President of Marketing Steve Bannerman said to Wired in 2006: "Anything that comes through (an internet protocol network), we can record. We can reconstruct all of their e-mails along with attachments, see what web pages they clicked on, we can reconstruct their [voice over internet protocol] calls."

Free Press is calling on Congress to take action on DPI.

The harm to democracy and the power to control the Internet are so disturbing that the threshold for the global trafficking in DPI must be set very high. That's why, before DPI becomes more widely used around the world and at home, Congress must establish legitimate standards for preventing the use of such control and surveillance technologies as means to violate human rights.

Congress would be opening a Pandora's Box in terms of looking at the US companies that provide equipment to foreign governments that could be used against protestors. Some of the largest US tech companies are suppliers to governments in China, Iran, Burma and other countries that have been accused of human rights violations.

But where do you draw the line? DPI has many uses, and not all of them are nefarious. It would be near impossible to control the export of network hardware and software based on its possible use by foreign governments.

However, a public shaming of US companies might have an impact and it would certainly be faster than waiting for Congress to act.

You can support Free Press and its call on Congress to investigate the use and sale of DPI technology by American companies by signing your name here.

The Washington, DC organization Consumer Watchdog is making a big publicity push for its "Do not track me" campaign, which asks Congress to create a list for people that don't want to be monitored on the Internet.

If the campaign succeeds it will be a massive blow to Internet advertising and e-commerce companies because they will lose the ability to tailor targeted commercial messages and discovering user behaviors across a range of web destinations.

Consumer Watchdog has purchased a 540 sq. Ft. Jumbotron digital billboard on Times Square and is showing a video showing an animation of Eric Schmidt, Google's CEO, driving an ice cream truck so that he can spy on kids.

Consumer Watchdog said:

Google has collected massive amounts of personal data from Wi-Fi networks through its Street View cars, made private Gmail contacts publicly available on Buzz, and done a complete about-face on net neutrality, joining with Verizon in calling for toll lanes on the Internet.

Schmidt has appeared clueless regarding privacy himself, Consumer Watchdog said. When questioned about privacy, he has said, “If you have something that you don’t want anyone to know, maybe you shouldn’t be doing it in the first place.” Recently, he suggested children could change their names when they got older if they wanted to escape what was embarrassing and public in their online lives.

- About 80% of Americans support a national "Do not track me" list according to a poll by Grove Insight.

- 90% said that it is important to “have more laws that protect privacy of your personal information” online.

The poll indicated strong support for:

- Require the creation of an “anonymous button” that allows individuals to stop anyone from tracking their online searches or purchases: 86% favor; 9% oppose.

- Ban the collection of any personal data on children under the age of 18: 84% favor; 10% oppose.

"The facts present a sobering reality of our broadband problem. We pay far too much for far too little, and the lack of meaningful competition among Internet service providers leads to delayed investment and slow technological progress."

The Telcos control the features available in smartphones often dumbing them down. That's Luddite behavior.

The Telcos have no real competition. As Danny Sullivan over at Search Engine Land points out:

The mobile marketplace... where providers unilaterally add on $10 surcharges just because you're using a smartphone, regardless of you actual data usage?

Where you can't take your expensive device and go elsewhere?

Where they deliberately cripple parts of a smartphone's OS?

Where they decide to charge you more for using your device as a modem even if that usage still comes under the same data cap as allowed by native use of your device?

If we can't have net neutrality then let's have more competition. But where is that competition going to come from?

Building a new Telecom infrastructure is expensive. Potentially, WiMAX could vault over the Telco walls but WiMAX rollout is slow and its performance is patchy. Plus, you need the customer facing support component and the billing relationship, which is labor intensive.

Another solution is to adopt open network policies as in Europe, where Telcos are forced by law to offer their platforms to third parties. But there is no way Congress will pass such a "socialist" law, especially with the Telco lobbyists making huge contributions to political campaigns.

Between the lack of any protection on the wireless side and the qualifiers and complexity on the wireline side, young startup companies will have difficulty finding financing and building businesses of scale. If an Internet access provider discriminates against a startup directly or through its network management practices, it is unlikely the startup could afford a long and expensive process to seek redress. So this proposal favors the incumbent applications and access providers.

I can't see an easy way out of it.

Luddite Telcos seem bent on keeping us in the Internet dark ages with slow connections and expensive services that will drive innovation out of the US. Government regulation has no teeth and our politicians have incentives to keep the status quo.

Where are Cisco, Intel, HP, IBM on net neutrality?

You would think that the infrastructure providers: Cisco Systems, Intel, HP, IBM, EMC, etc would be all be big supporters for more competition in Telco markets but they remain quiet. They would sell a whole lot more kit if there was more competition.

I once asked John Chambers, CEO of Cisco, why doesn't Cisco criticize Telco policy and come out with support for more competition in Telco markets? He smiled and said, "We support all of our valued customers."

But surely Mr. Chambers, and the heads of the other tech giants, have a fiduciary duty to maximize shareholder profits?

An open Internet with healthy competition would do wonders for sales. Yet where is their voice?

Net neutrality threatens GOOG, et al...

It is worth pointing out that Google, Yahoo and Microsoft have little to gain from net neutrality. I explained in a post from May, 2006:

Why risk an open and neutral Internet and become vulnerable to smaller, swifter competitors? Yes, right now GOOG, YHOO and some of the others move reasonably fast in some markets, but as they grow larger they won't be as nimble.

If you are a well established Internet services company such as GOOG, it doesn't pay to expose yourself to any disruptive, innovative startups. Why make it easy for your future competitors by fighting for their right to a neutral Internet?

That is why you should not look to GOOG et al, to save the Internet from the gatekeeper telcos and cable companies.

The big boys can afford to pay the Telcos and in exchange the Telcos keep the startups at bay. If I were a shareholder of Google, I'd be against net neutrality and I would campaign for Google to make deals with all the Telcos.

It's clear that's where Google is headed anyway...

The situation for startups and innovation in the US doesn't look good. Maybe it is time to relocate Silicon Valley elsewhere.

The Federal Communications Commission (FCC) has stopped its practice of closed door meetings because of public pressure in the wake of reports of talks between Google and Verizon on a preferential arrangement prioritizing Internet traffic.

FCC Chairman Julius Genachowski said: "Any outcome, any deal that doesn't preserve the freedom and openness of the Internet for consumers and entrepreneurs will be unacceptable."

"Phones have been ringing off the hook and e-mail inboxes overflowing at the FCC, as an outraged public learned about the closed-door deal-making and saw the biggest players trying to carve up the Internet for themselves. We're relieved to see that the FCC now apparently finds dangerous side deals from companies like Verizon and Google to be distasteful and unproductive.

"Now the FCC must match the chairman's words with decisive actions. We need our leaders in Washington to make the tough decisions and take on the difficult task of standing up to entrenched interests and pushing forward strong rules that will protect Internet users everywhere. Today, Julius Genachowski and the FCC took a big step back from the brink and gave everyone who cares about the free an open Internet reason to be hopeful that they still might do the right thing."

Google said that its meetings with Verizon have been misunderstood and that it is committed to an open Internet. Google and Verizon have held a series of talks over the past ten months abut how Verizon handles Internet traffic.

Net neutrality -- the idea that all data is treated equally by Internet service providers -- is a key principle of the Internet. Google has long claimed to be an advocate of the principle. Today both the Wall Street Journal and the New York Times reported that Google and Verizon are close to a deal that would let Verizon speed some online content more quickly to Internet users if content providers paid for the privilege.

Wednesday Google Chairman offered a new definition of net neutrality. Speaking at a technology symposium in Lake Tahoe, he said: "I want to make sure that everybody understands what we mean about it. What we mean is that if you have one data type, like video, you don't discriminate against one person's video in favor of another. It's OK to discriminate across different types..."

"Apparently Google redefines principles to suit the business need of the moment," said John M. Simpson, consumer advocate with the nonpartisan, nonprofit group. "Google and Verizon have great incentive to cut deals because of the relationship between their rivals, Apple and AT&T. What Google and Verizon are trying to do is carve up the Internet behind closed doors for their own benefit."Consumer Watchdog said that net neutrality has always meant that all types of data are treated equally by an Internet service provider. Net neutrality should apply to both the wired and wireless Internet, the nonprofit, nonpartisan group said.

Meanwhile, a national poll released by Consumer Watchdog found that a significant majority of Americans are troubled by recent revelations that Google's Street View cars gathered communications from home WiFi networks, and they want stronger legal protection to preserve their online privacy.While Google received an overall 74% favorable rating, nearly two-thirds of those polled (65%) say the Wi-Spy scandal is one of the things that "worries them most" or a "great deal" with another 20% saying it "raises some concern" when considering Internet issues.

The poll, conducted for Consumer Watchdog by Grove Insight, Ltd., found a solid majority (55%) is also bothered ("one of the most" or "great deal") by Google's cooperation with the National Security Agency without saying what information is being shared. Even more voters call for Congressional hearings on "Google's gathering data from home WiFi networks and its sharing of information with U.S. spy agencies like the National Security Administration, the NSA" (69% favor, 19% oppose).

The Federal Communications Commission today released a report that criticizes broadband rollout as not being deployed in a reasonable and timely manner.

The report found that less than 2% of US broadband connections are capable of originating a high definition video stream and less than half of all connections are capable of receiving a HD video stream.

Plus there are 14 million Americans without access to any high speed Internet service.

S. Derek Turner, Research Director of Free Press, a lobbying group advocating universal access to communications, said that he is pleased that the FCC "had the courage to do what all previous Commissions could not, and that is to put politics aside and take an objective look at the law and the data."

"The facts present a sobering reality of our broadband problem. We pay far too much for far too little, and the lack of meaningful competition among Internet service providers leads to delayed investment and slow technological progress."

Foremski's Take: This is further evidence that the cable and telco companies continue to hold the US back by providing some of the slowest ISP services in the world while charging high prices. The last mile connection into the home has become a "golden mile" for these companies and the lack of real competition has enabled them make fortunes from old technologies.

J. Nichols Hoover, at InformationWeek, reports that Michael McConnell, former director of national intelligence, Tuesday told the Senate committee on commerce, transportation, and technology:

"The cyber risk has become so important that, in my view, it rivals nuclear weapons in terms of seriousness."..."If the nation went to war today in a cyberwar, we would lose," he said. "We're the most vulnerable, we're the most connected, and we have the most to lose."

The intelligence agencies seem keen to scare Congress into fully funding the government cyber security initiatives. And for the Senate to pass a new cybersecurity bill.

Comparing a cyber attack with nuclear weapons, that can wipe out tens of millions of people in a single strike, seems like an extreme comparison. US intelligence agencies see themselves as a first line of defense and would gain from increased spending on cyber security.

Yesterday I made the case that Google's Nexus phone is nothing without the network. Whatever wonderful software and features Google and partners pile onto the phone, it is the network operators that have the final say on whether they will allow it -- which is why Google needs to own its own Telco more than it needs a branded phone.

Google cannot risk being cut off, or positioned a couple of clicks away because of a future decision by a Telco. If it owned its own network it wouldn't ned to worry about this issue.

- One of my readers suggested that Google could make an investment in a Telco that would ensure a couple of board seats -- that way Google wouldn't need to operate the Telco business itself and that would guarantee not being thrown off the network.

I don't see this as working because there would be too many conflicts of interest. Board members are chosen so that they can offer the best possible advice without a conflict of interest. GOOG has many areas of overlap with a Telco ranging from advertising to services such as Google Voice.

- Wouldn't net neutrality regulations protect Google and others?

No, not really because a Telco could decide to put Google's services a couple of clicks away from a cell phone's home screen. It is isn't preventing access to Google but it's not making it easy. It would be impossible to have a net neutrality regulation that guaranteed rights to a mobile phone's home screen.

- Why would Google sell it's own branded phone and compete with handset makers such as Motorola and others?

It doesn't make sense except to make sure that the Android standard doesn't fragment into many slightly different, but incompatible versions. That's what harmed Unix for many years. This way there will always be one true standard, the Nexus One, and that will discourage handset manufacturers from customizing their Android phones with proprietary features.

- What's Google's long term plan with mobile, what comes next after the Nexus?

The Nexus phone shows that Google is very serious about mobile. Eric Schmidt has publicly said on many occasions that the mobile web is a much larger business opportunity than the desktop/laptop search market.

But it's a totally different market where there is a lack of software and hardware standards as in the PC market. And for good reason: the Telcos and phone makers fought against Intel and Microsoft's attempts to standardize these markets in the same way that they succeeded in standardizing PC markets with their proprietary technologies.

In the PC market, Intel and Microsoft managed to aggregate most of the value-add. Their duopoly managed to maintain huge profit margins in the 60% plus range while PC makers, and others have had to survive on razor thin profit margins of just a few percent. The Telcos won't let that happen to their industry.

This means Google has to play by the rules of the Telco industry. It will need to pay for access.

It will pay the Telcos for prominent position on handsets and to guarantee that users have easy access to its services.

The iPhone holds the clues. Google pays to have its search box easily accessed on the iPhone. It also has prime position for its YouTube service on the home screen - you can't delete this icon like you can with downloadable apps.

This is the model for Google moving forward - paying the Telcos for position and access to mobile users.

Making such payments is nothing new for Google. In its most recent financial report it paid $1.59 billion to third parties for access to search traffic. These 'Traffic Acquisition Costs' (TAC) were 27% of its total advertising revenues. This was mostly to third-party web sites. In the future, it will be increasingly paid to Telcos.

This is a far better strategy than owning your own Telco. It's better because:

- It doesn't need to make a very expensive and complex Telco acquisition and deal with the government regulations.

- By not owning a Telco it can hit back at competitors and better control its partners. That's because it can use its money to buy clout. Smaller companies don't have the resources.

If Google had its own Telco it would feel obligated to ensure fair access to all. This way, it can hide behind the self-interest of Telcos and their control over their network and services.

And that's what will be next after Nexus: Google will make deals with Telcos to ensure its mobile services have prime positions.

- The Telcos will agree because Google can monetize the mobile phone screen real-estate -- and the network bandwidth -- better than the Telcos can themselves.

- The Telcos get paid and the business deal acts as barrier to entry for any Google competitors.

What's Microsoft going to do? It will have to follow suit. It has a mobile OS, it has relationships with the Telcos, it has the financial means to muscle in on similar type deals.

The losers will be the thousands of startups that won't have the same easy access to mobile users. They will be forced to partner with Google, Microsoft, or the Telcos, on their terms.

This means less innovation, less competition, and continued high prices for mobile access -- a digital divide far greater than the one on the desktop.

- - -

Advert:

To help subsidize my habit (publishing SVW) I'm now offering business strategy consulting services including media strategies. First come first serve. You should contact me here: tom (at) foremski.com or 415 336 7547.

President Barack Obama has promised to appoint a Chief Technology Officer for the US. I've heard some great suggestions from readers and I'm sure they would do a great job. My top choice would be Judy Estrin because of these qualities:

I think President Obama's CTO should be from Silicon Valley because we have some very capable people here, but more importantly, it would serve as a fantastic recognition that we have a national treasure here: an incredible engine of innovation that continues to produce in good times and not.

In fact, Silicon Valley produces its best work during its down times. It is during its periodic recessions that "next big thing" always gets developed. So this is a great time for Silicon Valley and it would be great if President Obama chose someone that comes from this area and understands the dynamics of innovation, imho.

President Barack Obama's administration comes to power with a large number of expectations from many sectors of society and industries. It is a testament to his victory that he has been able to become a beacon of change to so many.

One key industry expecting change is Silicon Valley and the business of technology and innovation. There is a lot that President Obama's administration could do to for this sector and it is a sector that could potentially help lift this economy out of the doldrums: innovation has always been an engine of change.

Silicon Valley and the Bay Area has an incredibly diverse economy and it has a major role to play in the future of this country and beyond. It has a unique combination of two great universities, a massive venture capital pool, and a workforce drawn from the world's best. And SIlicon Valley does its best work during times of downturn, all of its "next big things" emerge from its bust cycles.

Silicon Valley and its industries of technology and innovation haven't asked for a bailout, but they could benefit from the right policies and initiatives.

President Obama has promised to appoint the nation's first CTO. What should be top of their agenda?

Promoting WiMAX would please Intel and a few others. Or should tech policies focus on educating a 21st century entrerpreneurial workforce?

What do you think?

I'm going to be asking this question as I go around the valley and I will continue writing about this subject. If you have suggestions please tell me. I'd love to hear them.

Lawrence Lessig, a Stanford university law professor, claims that the US government has prepared a type of Patriot Act that is in place and ready for Congress should a major security event occur, a 9-11 type event. And just like the Patriot Act contains all sorts of new restrictions, there is concern that this I-Patriot Act will have many restrictions and laws that may limit the way the Internet is used.

This is from Fortune Brainstorm conference "2018: Life on the Net." It was moderated by Quincy Smith, CEO of CBS Interactive. On the podium was Lawrence Lessig, professor of Law at Stanford Law School, Joichi Ito, CEO of Creative Commons and Chairman of Six Apart Japan, and Philip Rosedale, founder and chairman of Linden Lab, (Second Life.)

This is the relevant section where Mr Lessig talks about having dinner with Richard Clark, the government Counter terrorism Czar.

Lessig: "I had dinner once with Richard Clark at the table and I said 'is there an equivalent to the Patriot Act -- an iPatriot Act -- just sitting waiting for some substantial event just waiting for them to come have the excuse for radically changing the way the Internet works?' And he said, 'Of course there is' -- and I swear this is what he said, and quote -- 'and Vint Cerf is not going to like it very much.'"

I interviewed Mr Cerf at the Fortune Brainstorm conference in Half Moon Bay. He often speaks about net neutrality. In this interview he says that companies such as Verizon misquoted him in full page adverts in major newspapers.

He says the Telcos are acting like little kids in a tantrum. "I'm not going to build this system unless you give me three scoops of ice cream and a pony. My reaction to this is quite negative. It's harmful to the national interest to behave in this way."

Mr Cerf wants a split in the way broadband providers operate so that they are not allowed to interfere with any applications on the Internet and that the carriers charge themselvesl, from an acconting point of view, how much bandwidth they use.

He says that carriers should be provided with incentives to make them behave differently or there should be an incentive for competitors to come into the market that can effectively compete with them and to take away their monopoly position.

Here is the 3.45 minute interview, my apologies for the lighting but the audio is very interesting.

Update: Here is a story from Australia's ITWire which provides a partial transcript of the video:

Vint Cerf, who is widely regarded as the 'father of the Internet' for his contribution to the original TCP/IP specification, has lashed out at carriers accusing them of behaving like young children throwing tantrums. In an especially strongly worded attack, Cerf called for structural separation between the wholesale and retail broadband arms of carriers among other changes.

In a brief interview with SiliconValleyWatcher, Cerf said carriers were effectively saying "I'm not going to build this system unless you give me three scoops of ice cream and a pony", and provided a laundry list of changes in the regulatory environment that he'd like to see to improve the situation. These include:

The reintroduction of common carrier status;

Structural or accounting separation, with a requirement that carriers wholesale broadband at the same prices that they charge themselves; and

No interference with other providers' applications (ie, net neutrality).

The current behaviour of carriers is harmful to the national interest, he said - an observation that wouldn't only apply to the US.

"[Deregulation] is crap, especially where you have a set of incumbents," he said. Instead, we "need a set of rules that makes sense."

Consequently, carriers need to be given incentives to behave differently or (Cerf's emphasis) incentives should be provided for competitors to compete with incumbents.

"In places where there is strong regulatory control, it seems to be working," he said.
You need to keep in mind that Cerf is a vice president at Google (a strong proponent of network neutrality), but there's no reason to assume that his opinions are not genuinely held.
We can't help feeling Cerf could just as easily be talking about Telstra as the US carriers that were the subject of his onslaught.
Currently an argument is raging between incumbent dominant carrier Telstra and other smaller players, with regulator the Australian Competition and Consumer Commission sandwiched in between. Telstra, a front-runner to build a national broadband FTTH network, is pressing to have the market dregulated so it is not forced to sell competitors bandwidth at regulated wholesale prices.

I know they mean well, but tech execs are really bad at lobbying Washington.

Earlier, I wrote about the tech policy agenda unveiled by top US tech executives, all members of the Technet organization. [Please see ZDNet: Tech giants reveal their agenda.]

A short time later, I took another look at the news release to re-read the vague wording in much of Technet's 2008 Innovation Policy Agenda.

Take a look at the number one policy issue:

Green Technologies Initiative: Promote and highlight new technologies and innovation as a critical part of the solution to national security, economic competitiveness and global energy and environmental challenges and encourage a national commitment for investment in and adoption of innovative green technologies...

The vague wording appears pandering rather than a leading Green initiative.

Technet's second, third, and fourth most important issues are:

Education and 21st Century Workforce: Develop initiatives to improve science and math education, and increase the number of Americans attaining degrees in science, technology, engineering and mathematics through new programs and resources that strengthen our public schools.

Immigration Reform: Promote comprehensive highly skilled immigration reform including an increase in the H-1B visa cap and reforms to the employment-based green card process to ensure the U.S. has a highly skilled workforce.

Basic Research: Support strong national investments in research and development through increased federal funding for basic research and a permanent R&D tax credit.

All worthy issues and vaguely expressed in a very familiar way.

I would say that the last four items on Technet's Policy Agenda are far more immediately important than the others:

Patent Litigation Reform: Advance proposals with the goal of ending abusive lawsuits brought by plaintiffs using patents as a means of obtaining settlements from legitimate technology businesses.

Trade and Public Diplomacy: Work closely with national policymakers to enact trade agreements that strengthen our companies through expanded market access overseas. Our members increasingly rely on international markets for growth and we will work to support legislative efforts to enter those markets as well as agreements that guard and protect intellectual property. TechNet will also support public diplomacy initiatives, expanded trade as well as dialogue with policymakers regarding key issues including China policy.

Broadband and Internet Policy: Provide strong support for the growth and vitality of the Internet and accelerated broadband deployment by advocating for consumer access to Internet content and services and a permanent Internet tax moratorium.

Sarbanes-Oxley Rational Relief: Work to reduce the Sarbanes-Oxley Act’s compliance burdens and impacts on small companies, while maintaining the integrity of the Act’s corporate governance goals. This will reduce unnecessary costs and mitigate unintended consequences of the Sarbanes-Oxley Act that are impacting innovation.

I constantly hear about those four issues from tech execs. Yet they are buried at the end of a long news release filled with salutations and other important quotes:

"

Senator Patrick Leahy represents a true visionary when it comes to leadership on innovation and technology issues in the United States Senate," said John Chambers, Cisco Chairman and CEO and co-founder of TechNet. "We are so pleased to honor his stellar service as Chairman of the Judiciary Committee and steadfast leadership on issues ranging from preserving intellectual property, promoting green technology, improving our education system and clearly seeing how cutting edge discovery grows our economy and improves our way of life."

. . .

"It is in our nation’s long-term strategic interest to maintain a robust system that effectively balances the need to facilitate new idea generation and reward innovators," said Art Coviello, Co-Chair of TechNet New England and President of RSA, The Security Division of EMC. . .

. . .

“Representative Chris Cannon has been an outstanding champion of the technology industry, as demonstrated by his tireless and successful efforts of enhancing cyber crime laws, championing intellectual property protections, supporting high skilled immigration reform and modernizing the nation’s patent laws,” said David Thompson, group president, Symantec IT and Services Group...

My suggestion would be to drop the cliche quotes, and then republish the policy agenda in reverse order.

It was a cold night in San Francisco but plenty of people made it out to the Electronic Frontier Foundation's 17th birthday party at 111 Minna. Here is a 3 minute walk through the event, see if you can spot co-founder John Perry Barlow. Scott Beale from Laughing Squid is in the intro.

Comcast's blocking of large file transfers is just the tip of the iceberg. And it is only a matter of time before other cable and telco companies will follow suit.

This is the start of a battle for bandwidth that has been caused by enormous amounts of digital media hitting the Internet and the private networks of the cable and telco companies. It is a battle that nearly all Silicon Valley companies are unprepared for and won't be able to win.

Comcast and the others can legitimately limit third party services because they have a contract with their customers to deliver a slew of digital services from digital phone calls, digital music, and high definition TV. They don't have a contract to deliver the digital services of others.

How long before they kill most of the Web 2.0 companies? They all seek to share files and information between groups, including video and audio. FaceBook, for example, lets users upload 300 MB video files.

What about new services such as Fabrik's Ultimate Backup Service, which offers unlimited backups for $5 a month. Will Fabrik and others be able to build such businesses?

Why should they provide quality access to digital services (YouTube, BitTorrent, etc) if they don't have a contractual obligation? Access to those services comes second or third to their own services and those of partners.

Corporate Luddites

The cable and telco companies are the most powerful Luddite organizations in the US. They hold a duopoly control over the lines that connect consumers with digital services.

The cable and telco companies are slow in bringing in new technologies, and their wireless operations turn off many technologies, such as wi-fi in cell phones. They have slowed technological progress in the US in so many ways. For example, We have some of the lowest adoption rates and the slowest broadband in the world. We have a huge digital divide.

They will protect themselves from technologies that would disrupt them in the same way early 19th century English Luddites broke industrial machines to save their livelihoods.

The English dealt with their anti-technologists in this way: "Machine breaking" (industrial sabotage) was made a capital crime." (Wikipedia.)

No such luck here. These Luddites have the government on their side, they have among the strongest lobbying groups in Washington, built up over a period of more than 100 years.

The cable and telco companies are anti-competitive and their actions will make sure that the US becomes uncompetitive.

Thursday morning I rushed across to the East Bay to catch TechNet's Innovation Summit at UC Berkeley--but I should have lingered longer in bed.

The morning session featured Charlie Rose moderating a conversation between John Chambers, CEO of Cisco Systems; John Chen, CEO of Sybase; and Laura Tyson, Professor Haas Business and Public Policy Group at UC Berkeley. The subject: Charting a National Innovation Policy for the Next Decade.

It was tremendously dull because there was nothing new said. And Charlie Rose's ability to throw softball questions, while making them sound insightful and important, added further layers of misery.

They said the same things I've been hearing them, and their ilk say for the past few years. Not enough H1b visas; education is very important; not enough engineers being produced in the US; not enough math being taught in US schools; government needs to fund research; government need to stay out of technology choices, overseas governments are jumping ahead of US by making technology choices; etc.

At the mid-morning break I ran into a lot of people I knew from various Silicon Valley companies, and also other journalists. I complained about the lack of content.

I said I'm tired of hearing John Chambers say that our school system is broken. Why does he boast of installing a cutting edge network in the new local baseball stadium, Cisco should be boasting of doing that in our local schools.

Our Silicon Valley leaders constantly complain about education yet allow their local schools to become basket cases. They should be showcases.

Silicon Valley cannot go around saying to the world "We are inventing the future here," when its local communities are struggling and unable to cope with the present.

If Silicon Valley's technologies are so incredibly powerful and game changing let's see them applied in our own communities first, especially our schools. Wouldn't that be an amazing example to the world? Wouldn't that be an amazing project for John Chambers, one of our top business leaders and visionaries? I bet he could do anything he sets his mind to, instead of giving up on the schools by saying the system is broken and cannot be fixed.

Sucks less

Everybody I spoke with agreed with my complaints about the content, saying they were surprised that this venue couldn't produce anything new. However, one of my colleagues at a large newspaper, jumped into the discussion saying he strongly disagreed with what I was saying.

"This event is slightly less useless than the one they had at Stanford (university) a while back, that one was was totally useless." Great compliment, I said. So, this one sucks less than the other one, which totally sucked.

One former exec of one of Silicon Valley's largest companies said "it seemed like 1997 warmed over again."

Discouraged by the quality of the first half of the summit, I skipped the second panel of the morning: Charlie Rose throwing softballs on Green Technologies with John Doerr, uberVC; Jonathan Swartz CEO of Sun; John Melo, CEO of Amyris Biotechnologies and Larry Brilliant, head of Google.org. I would have liked to have seen Mr Brilliant [btw, brilliant name although it must have been tough growing up with it.]

TechNet's mission statement:

To serve as the voice and advocate of the innovation economy by uniting CEOs and Senior Executives with leading policy makers in a bipartisan effort to sustain and advance America's global leadership in technology and innovation.

Clearly, with content such as this Innovation Summit, TechNet has chosen an extremely challenging approach to fulfilling its mission statement.

Star power such as Walt Mossberg and Kara Swisher of the Wall Street Journal and other top editors from the Financial Times, Time, Forbes, BusinessWeek, Newsweek and even blog publisher Om Malik -- couldn't draw much of a local crowd.

I popped in on Tuesday and caught a few panels.

The Future of the Internet panel moderated by Declan McCullagh, News.com was lackluster with Jim Dempsey, policy director, Center for Democracy and Technology, Lauren Gelman, Assoc. Director of Stanford's Center for Internet and Society, and Andrew McLaughlin, head of global public policy and senior counsel at Google.

There was a lot of talk but little was said. I complained about it to Sean Garrett, one of the founders of 463 Communications, helping tech companies to "navigate the intersection of technology, public policy and government."

He said that much of the talk was in a type of "code" that is understandable by those that deal with Washington politics.

"For example, one person at my table was surprised at what the Google guy had to say. And often, it is not what they say, but what the don't say," he explained.

It was good to catch up with Mr Garrett, he always brings insightful perspectives into the tech policy process. He works closely with big Silicon Valley companies such as Cisco, Sun Microsystems and Verisign. And he is a blogger too, writing The 463: Inside Tech Policy blog.

He said that it was interesting that the older technology companies lobbied politicians in the old way, with face to face meetings, etc. There was no one using the social networking technologies. "There is an opportunity for a hybrid approach," he said, but no one is doing it, at least not yet.

Tech Policy Summit is an invitation-only executive conference that brings together prominent leaders from the private and public sectors to examine critical policy issues affecting technology innovation and adoption in Silicon Valley and beyond.

Kara Swisher moderated Policy 2.0: Social Media and Government Regulation. This panel had many of the leading poster boys of "Web 2.0 and social media."

Jonathan Abrams, the former Friendster CEO, was there. He is now CEO of Socializr, which is in private beta and which he described as a cross between Friendster and Evite. Also on stage: Jay Adelson, CEO of Digg; Reid Hoffman, president of LinkedIn; and David Sifry, CEO of Technorati.

Ms Swisher kept the conversation rolling and interesting but there was absolutely zero discussion of government regulation and social media!

It became an apt illustration of how little interest there is in government policy among tech companies coming from a top Silicon Valley journalist and the stars of the Web 2.0 movement.

With the topic dismissed, the panel discussed other subjects. Ms Swisher gave Mr Adelson a withering look when she pointed out that Digg profited from posting copyrighted material and was "feeding off of other people's content." Mr Adelson noted that not a single copyright holder had ever complained about being featured on Digg.

Identity on the Internet was discussed, and Mr Hoffman said LinkedIn offered a way for others to discover sanctioned information about their identities.

The panel talked a lot about new media and old media. David Sifry of Technorati was very impressive, he came out with some excellent insights, sharing a lot of the points I've made many times about media and blogging. He talked abut how the blogs need big media and vice versa, it is not one versus the other but both together.

I was heartened to see that Mr Sifry raised an issue I've been warning about for nearly two years: as old media's business fortunes decline who will pay for quality journalism?

(I often explain it this way: what happens if the old media dies before the new media learns to walk? We need quality media because media is how society "thinks" it is how it decides how to tackle tough problems, and we have lots of them.)

Mr Sifry noted that the economic models for big media are being torn apart. "What is the future for news? That's the real question, it is essential to democracy."

He even mentioned a favorite example of mine, Bill Keller, editor of the New York Times, saying that online revenues couldn't pay for a fraction of operating costs. For example, the Baghdad bureau costs over $1m/year to operate.

Walt Mossberg spoke up from the audience, stating to the panel that the Web 2.0 generation didn't like to read--especially long, complex articles about important subjects.

Mr Adelson said that his experience was that teenagers were reading a lot more, and tackling long, complex articles because of their Digg involvement.

Old media is being cut off at the knees as Google and a few others grab ad revenues. But for most new media enterprises, existing business models don't generate enough revenue and it's not yet clear what will. An analysis of the situation and some thoughts on new approaches.

Elizabeth Corcoran, an editor at Forbes, moderated Developing Top Talent: Education, Immigration, and Innovation Leadership. She did a fine, spirited job trying to enliven the panel members: Phil Bond, head of the Information Technology Association of America. Dr. AnnaLee Saxenian, Dean, UC Berkeley's school of Information, and Rosen Sharma, CEO of Solidcore Systems.

She eventually succeeded in her mission and there were some interesting points made. Mr Sharma said that the work visa process to bring in a foreign worker is too long, at least 3 months to arrange for an interview when it used to be done the same day.

He said that even if the visa process were opened up, it is not clear that the US could attract the world's top talent. He said China, for example, was hiring "hordes" of top medical practitioners to staff its medical universities.

Mr Bond complained that tech companies no longer had the same glamerous appeal they once had among politicians. And that the tech sector voice was too fragmented, it was split among too many associations.

He added that the tech industry wasn't able to bring attention to the positive aspects outsourcing, that it actually does create jobs here.

Ms. Saxenian said that tech companies lost a lot of their glamour after the dotcom bust. And that tech companies have never spent enough money contributing to political campaigns.

"The politicians like to say that the tech companies have deep pockets and short arms," she said.